June 19, 2008

NIAC memo: Why Tehran Will Reject the New Incentive Package

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Washington, DC – Iran’s likely rejection of the new incentive package to halt the country’s nuclear enrichment program has opened a new chapter in Tehran’s successive transgression of nuclear demarcations. Even before EU foreign policy and security chief, Javeir Solana, could deliver the package to the Iranian Foreign Minister, Tehran had already warned that it would reject any deal requiring a halt to uranium enrichment. In the words of Ali Larijani, the new speaker of the parliament, Iran is allergic to the suspension of its enrichment program.

For those who describe the package as a “generous offer,” Iran’s decision appears insular, even irrational. However, if the purpose of the deal is to lure Tehran suspend enrichment, the new package, once again, failed to deliver the most significant incentive for Tehran to change its behavior: the permanent deferment of the U.S. containment strategy. What the Islamic Republic urgently wants is the assurance that Washington will not pose a threat to its survival, a comprehensive package of incentive that explicates a consistent U.S. policy toward Iran, devoid of economic sanctions and an aggressive program for regime change.

Tehran’s reaction to the package is threefold. First off, Tehran has been defying U.S. sanctions for years, acquiring much needed technology for its nuclear program from alternative markets in Asia. Sanctions will certainly make things harder for Iran, but not necessarily prevent it from developing nuclear technology. Armed with a huge windfall of oil revenue due to record-high oil prices, Tehran will continue to acquire new technology and expand its nuclear program in subversive ways, defying future U.N. sanctions, as it has successfully continued to do since it rejected the first incentive package in 2006.

Rejection of the latest package is backed with the belief that the U.S. is militarily too vulnerable to attack Iran and the Security Council lacks the political will to engage in a military confrontation. For the most part, Tehran views the logic of sanctions primarily as a tactic of psychological warfare that is best tackled with defiance.

The notion of defiance brings us to the second reason why Tehran will reject the package: symbolic politics. The country’s nuclear program is a source of national pride to many Iranians, even to dissidents strongly opposed to the theocratic regime. The idea that Iran should pursue nuclear technology despite foreign pressures is a belief that is shared by many Iranians of diverse political backgrounds. The clerical regime is fully aware of the power of such symbolic politics and continues to capitalize on it by propagating the value of its nuclear project through various civic, educational institutions and media outlets, including popular shows on television. In fact, with an increase of sanctions, Tehran will find more ammunition to bolster its legitimacy among ordinary Iranians, therefore continue with its uranium enrichment capabilities at a faster pace.

But the main reason why Tehran will reject the offer lies with Iran’s deep suspicion over U.S. objectives to endorse the incentive package. History serves as a guide here. At the time when the six-nation offer of incentives was rejected by Tehran in 2006, the U.S. State Department allocated $75 million in emergency funds to support oppositional forces outside and inside Iran. The problem with the democracy-promotion program was that it was made public only months before the first incentive package was introduced to Tehran. The regime-change policy cancelled out the incentive package, since it promoted programs for the annihilation of the regime while at the same time offering incentives for its survival. Such inconsistencies have made the Iranian regime highly suspicious of Washington’s participation in the nuclear talks.

It is now highly likely that Iran’s move will prompt the Security Council and Germany to adopt tougher sanctions. While sanctions will surely hinder Iran’s economic growth, such punitive measures aimed at international ostracism will only harden Tehran’s posture on the nuclear issue and, in turn, encourage it to charge ahead with its nuclear program. With the rise of a climate of suspicion, the Iranian regime will also move to further limit political activities in the name of unifying the nation against a foreign threat. In reality, the repercussions of the sanctions are multitude, most significantly hindering the growth of the Iranian civil society as the regime gains strength with the increasing centralization of state power as a reaction to the sanctions.

Yet recent tensions over Iran’s nuclear program come as Iran’s political landscape undergo considerable transformation. As America heads to the polls in November, the newly elected Iranian parliament embraces a new political approach, which appears to be less confrontational in posture though still cautious about West’s intentions to halt Iran’s nuclear program. Led by the pragmatic Ali Larijani, the revisionist conservatives still want to negotiate with the West over the nuclear issue; however, they are weary of Washington’s objective toward Iran.

For some time to come, the political balance in Iran will be indirectly shaped by decisions Washington will make to influence the Security Council. The best way of promoting nuclear non-proliferation and democratization in Iran is by allowing the Iranian civil society to have direct access to the global market. But in order to do so, Washington must first reconsider its policy of sanctions that only helps empowering the Iranian state and weaken Iran’s civil society.

Prof. Babak Rahimi teaches Iranian and Islamic Studies at University of California San Diego. He is currently conducting field research in Iran.




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